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QMI Agency

Jun 19, 2012

, Last Updated: 4:27 PM ET

The remaining few months before the first flight of Bombardier Inc’s all-new C-Series jetliner will be crammed with a barrage of final assembly and safety tests, but development is still on schedule, company executives said on Tuesday.

Bombardier, the world’s third-biggest planemaker, has said it will test fly the C-Series jet for the first time by the end of 2012. The company wants the aircraft, aimed at the 100-to 149-seat market where it will compete with smaller aircraft built by industry leaders Boeing Co and Airbus, to enter service a year later.

“It is true the back end of the program is compressed. There is no doubt,” said Rob Dewar, vice-president of the C-Series program, Bombardier’s $3 billion stab at building its biggest plane yet.

Analysts and investors are closely watching the C-Series’ timetable because the aircraft sector has been haunted by chronic development delays.

Canaccord Genuity analyst David Tyerman said the tightness of the schedule is something to keep a close eye on but that it was also worth keeping perspective.

“Really, as long as this doesn’t turn into a B787 or A380 situation we’re getting too myopic I think,” he said, referring to prolonged delays of aircraft built by Boeing and Airbus, respectively.

Dewar said that early tests on the C-Series are going better than planned. “We are hopeful that trend continues,” he said, adding that the company should then “actually be able to live with that compressed schedule”.

He said Bombardier should have “better visibility” on the timetable by the end of September.

TIMETABLE INTACT

“We are driving for the first flight in 2012. We are working towards an entry of service for our CS-100 aircraft by the end of 2013 and by 2014 for the CS-300 aircraft,” said Mike Arcamone, the newly appointed president of Bombardier’s commercial aircraft unit, under which the C-Series program falls.

Company executives were speaking to analysts and the media at an event in Montreal, where Bombardier is based, that was held to showcase the C-Series ahead of the Farnborough International Airshow in England next month.

Asked if Bombardier expected any C-Series orders at the important biennial industry event, Arcamone said orders were announced when they were received and not tied to air shows. Aircraft lessors were very interested in the plane, he said.

The C-Series has failed to attract a steady stream of orders, raising concerns about the cost and eventual success of Bombardier’s most expensive development program yet. Some 18 months ahead of the plane’s launch, it has 11 customers and 138 firm orders.

Arcamone, who was appointed president of Bombardier commercial aircraft in February after his predecessor, Gary Scott, retired unexpectedly last year, said in an interview that he was sticking with Scott’s target of about 300 firm orders by entry into service.

Like Scott, he is also targeting 20-30 customers and favors securing several small orders rather than a 100-plane order from a single customer.

“At this point of time we are very, very comfortable in terms of where we are on pricing and where we are on the number of customers,” said Arcamone, a former auto industry executive who was most recently chief executive of General Motors in South Korea.

He said the C-Series program is also within budget.

Bombardier’s stock closed unchanged at C$4.05 on the Toronto Stock Exchange on Tuesday afternoon, lagging a big rise on the benchmark index.

The stock is down more than 40 percent in the past year, hurt partly by weak orders for its commercial jets as world economies stay soft and competition mounts.

Earlier on Tuesday, Bombardier trimmed its long-term forecast for sales in the commercial aircraft industry, citing signals of slower global economic growth and sharp increases in oil prices. It kept its business jet forecast unchanged from a year earlier.